Answer:
Total production= 5,840 units
Explanation:
Giving the following information:
Sales in units:
July= 5,000
August= 5,700
September= 5,560
The company wants to end each month with ending finished goods inventory equal to 25% of the next month's sales. The finished goods inventory on June 30 is 1,250 units.
To determine the production for August, we need to use the following structure:
Production budget:
Sales= 5,700
Desired ending inventory= (5,560*0.25)= 1,390
Beginning inventory= (1,250)
Total production= 5,840 units
